MEDIA COMMENT: The Filber recommendations – good or bad?

We can only hope that five years from now all this will be moot, as the Internet, cellphone and WiFi markets will make any attempt at draconian regulatory measures obsolete.

Shlomo Filber is the director-general of the Communications Ministry, responsible to the Prime Minister Benjamin Netanyahu, who is also the communications minister. Filber is an experienced executive, having served previously as director general of the Yesha Council and as the Netanyahu’s chief of staff. From 2003-2009 he was the secretary of the board of directors as well as the assets manager of Israel Railways. In the last election campaign, he was head of the Likud Party’s elections headquarters.

Having entered the job at the Communications Ministry, he was faced with two major challenges: the organization of and the responsibility for the new Israeli Broadcasting Corporation (IBC), and reorganizing the broadcasting industry in Israel.

For the latter purpose, the prime minister appointed a committee headed by Filber whose task was to provide recommendations regarding the regulatory process of the industry. The other members of Filber’s committee were Eva Meziboz, chairperson of the Second Authority for TV and Radio; Advocate Dana Neufeld, the ministry’s legal adviser, whose record includes serving under communications minister Gilad Erdan and being part of the sad, post-Zionist legislation underlying the IBC; Haran Lav’ut, the ministry’s deputy director, responsible for finances; Assaf Wasserzug; Dr. Yifat Ben-Chai Segev, chairperson of the Cable and Satellite Authority; Advocate Eli’or Balitner from the Justice Ministry; and Yair Hakak, head of planning at the ministry.

There is an inherent conflict of interest in this committee as two of its members are heads of powerful regulatory bodies in Israel, while the task of the committee was to find ways to reduce government involvement in the industry, including unifying the two authorities into one. This should suggest that at least one of the two heads stands to lose her job.

Yet the cover letter Filber sent to Prime Minister Netanyahu sounded very positive, stating that Filber believes the recommendations of his commission would lead to “a reduction in government involvement in content, creation of a broader range of opinion and content to Israel’s citizenship and strengthening pluralism in Israel’s broadcasting market.”

Indeed, in the practical steps outlined in the Filber report there are some important recommendations, which if implemented would do just that. For example, today, TV channel 20 is not permitted to broadcast independently produced news and news-related programming. The committee recommends allowing any content provider to provide news broadcasting, provided that it conforms to accepted ethical codes.

One of the difficulties facing any broadcasting company in Israel today is that the satellite and cable companies Hot and Yes are able, and in practice do, prevent any serious competition by imposing ridiculous fees on content providers. This will stop. Hot and Yes will be allowed to take a set fee, which will be equal for all content providers. If they exaggerate, the minister responsible would set the price.

The committee also set out to make it easier for the consumer to receive sports broadcasts. The sports channels would no longer be permitted to ask an exorbitant price for their content but it would be on the basis of the number of subscribers to the channel.

Another positive recommendation is to gradually reduce any limitations on the number of advertisements allowed. In practice this leaves it to the consumer to decide whether she or he wants to view a channel which constantly disrupts its programming with ads.

However, there are many pitfalls in the recommendations. First and foremost, as expected the regulatory commission will still have much too much power. Even the recommendations outlined above are predicated on the idea that the regulatory body is the czar of the broadcasting industry.

This clinging to power by the bureaucracy is especially evident when considering the recommendations concerning content.

The Filber report notes that at present, Israel spends NIS 740 million on original local content. The commission recommends steps that will assure that this level of spending will remain. It distinguishes between different content providers. The very small ones, with less than 10 percent of the total market share of broadcasting advertising in Israel, would be free to provide whatever content they choose.

The committee expressly notes that market rules of supply and demand would regulate their content. But then companies whose income over a period of three years is more than 10% of the advertising market would be considered owners of an “established” commercial license, which would have to provide news programming. A provider with more than 20% of the advertising market share would have to invest in local programming in addition to news.

These draconian measures conflict with the idea that Israel should have a free market.

Instead of the lengthy deliberations and complex measures which the commission presents, it should have made a clear and unequivocal statement that anyone can broadcast provided that they conform to minimal standards of ethics and the broadcasting laws, such as safeguarding against the exploitation of minors.

The commission itself was aware of some of the limitations. It acknowledged that its recommendations should be considered an interim, five-year measure. After all, no one can foresee how the Internet market will continue to develop.

We can only hope that five years from now all this will be moot, as the Internet, cellphone and WiFi markets will make any attempt at draconian regulatory measures obsolete.